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No homeowner starts the building process with the intent of switching contractors halfway through, but things happen. When this unfortunate situation arises due to the builder breaching the contract, shoddy workmanship or through unforeseen events, it’s essential that you take steps to protect your financial investment. Switching builders almost always costs you more money but if you’re truly unhappy with your current builder, it might be the best choice.

Before Cutting Ties

It’s in your best interest to keep the breakup on friendly terms. During the construction phase of a house, many factors are in play. Building materials delivered to the jobsite might not be paid for yet and subcontractors might not be willing to continue working under a different contractor. Instead of firing your contractor in a heat of rage, sit down with him and ask for his cooperation in smoothing the transition to a new contractor.

The Money Factor

If your banker has set up an escrow account for dispersing payments to the contractor, call and notify your banker of the problem so the contractor cannot draw any more funds from the account. Contact the lumberyards and other material distributors and find out if the contractor paid for previously ordered materials. Request that no more materials be sold to the contractor on your house account.

Hiring a New Contractor

You could run into problems finding a new contractor who will jump into the project where the old contractor left off. Contractors have their own ways of doing things and if you’re getting rid of the old contractor because of shoddy workmanship, the new contractor might not want to continue building on what he considers a substandard foundation or framing. If you find a general contractor willing to come in, you still might have to pull a new permit because housing permits list the contractors and subcontractors who will be on the project.

Subcontractors

Good subcontractors are the backbone of any well-built house. They install the wiring, plumbing, roofing and heating elements, but they are typically very loyal to the contractors who hire them. If you and the contractor part on angry terms, it’s possible that you’ll lose the subcontractors as well. They might want to work on your house, but it’s only one project and the contractor gives them years of work.

Settling Up

It’s imperative that you get signed lien releases from the original contractor, the material suppliers and the subcontractors before the new contractor walks on the job. Your lender can help you with this. Any lumberyard or subcontractor who has not been paid for materials delivered or services rendered can file a mechanic’s lien on your house, creating a cloud on the title and making it difficult to sell.

Filing a Complaint

If you feel the original contractor defrauded you or breached his end of the contract, you can file a complaint with your local building authority. In some communities and states, homeowners have additional legal avenues which include filing for restitution with a contractor’s oversight board. There’s no guarantee you’ll get a payment, but it doesn’t hurt to try if you’ve lost money through no fault of your own.

About the Author

Glenda Taylor is a contractor and a full-time writer specializing in construction writing. She also enjoys writing business and finance, food and drink and pet-related articles. Her education includes marketing and a bachelor's degree in journalism from the University of Kansas.